Miami Beach to develop plan to recover unpaid developer fees

Miami Beach city commissioners were disturbed Wednesday night to learn the city is owed about $19million in unpaid developer fees, and they want to develop a strategy to collect as much as they can.

That money was found missing after city staff reviewed a program that allows developers to pay the city a fee instead of providing required parking spaces — a fee that is supposed to pay for improved public parking. The investigation revealed an ugly mess of sloppy record-keeping, shoddy accounting and inconsistent billing under previous administrations over the course of the 25 years the program has existed. That $19million is about enough to pay for two 500-space parking garages.

At Wednesday night’s City Commission meeting, commissioners asked staffers to come up with a plan to collect money that was inappropriately paid to escrow accounts first, then to pursue big-ticket bills that in some cases amount to hundreds of thousands of dollars.

“Let’s go after the low-hanging fruit first,” said Commissioner Deede Weithorn. “And every single significant amount of money next.”

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Commissioner Jonah Wolfson worried some smaller businesses could be bankrupted if they’re forced to pay. He asked staffers to consider fairness to smaller firms when developing a collection plan.

“I think we should look really carefully at what we’re doing,” he said.

City Attorney Raul Aguila told commissioners the statute of limitations on unpaid debt is five years, but the city could still try to pursue older fees.

“Those are defenses that can be raised by the party owing us money in each of these cases,” he said.

The commission will consider a collection plan at its Sept.30 meeting.

The review, initiated by Assistant City Manager Joe Jimenez and Deputy Planning Director Carmen Sanchez, took nine months to complete.

Jimenez told the Miami Herald that considering the randomness and inconsistency of the problems, he suspected the issue was mismanagement and poor practices but not corruption.

“I have no reason to suspect any wrongdoing,” he said. “But this can lead to corruption.”

Deputy Planning Director Carmen Sanchez said in an interview the department has already started to clean up the mess by developing policies and improving city software and internal communication.

“We’re putting in place all the proper safeguards to make sure this never happens again,” she said.

Commissioners acknowledged the revelation leaves Miami Beach with another black eye because of the shortcomings of previous administrators, but they praised City Manager Jimmy Morales for identifying an old problem and bringing it forward.